this is how it works in houston, which has no zoning. half of the residential neighborhoods have restrictions. if you live in a neighborhood without restrictions, you are allowed to petition neighbors, and if 75% agree, you can write covenants and restrictions for your neighborhood. if the developer says we think your neighborhood would be more valuable if we changed it, and we will pay you to change, you can vote to do that. that happens all the time. you get an evolutionary system that responds to demand, rather than government winds and fads. >> your thoughts about the federal housing administration, maintained a stable housing market, has helped lower and middle homes in the market. guest: when you have something like the f.h.a., you actually are creating more instability in the housing market. host: how do they subsidy it? guest: when you have land use restrictions, increases in demand mean rapid increases in prices. and so instead of housing prices going like this, you see housing prices going like this. and that ends up creating l